There Are 83-Million Millennials in the US. Here’s How They Spend Their Money
Millennials are spending trillions of dollars every year.
PHOTO CREDIT: Getty Images
Millennials are the largest generation in United States history. They are also the first truly digital native generation.
Millennials are saddled with student loan debt and are making less money than their predecessors did at their age just a generation or two ago, so their shopping habits are reflecting having too much month at the end of the money.
But financial considerations aren't the only thing on Millennials' minds -- they care deeply about the world around them, and it is reflected in their shopping habits. Millennials have some very different shopping habits from previous generations, and brands need to take note.
Millennials use smartphones to create seamless shopping experiences
Many Millennials report going into stores to scope out a product before buying it online at a lower price elsewhere or searching for coupons while they are in the store. They turn to their phones for help with customer service issues before looking for a person. They care about how their favorite brands interact with consumers on social media.
Just because Millennials click "like" doesn't mean they are loyal to a brand, and many use social media just to find deals and resolve customer service issues.
- 84% of Millennials use their phone for shopping assistance while in a store.
- 53% of Millennials use their phone to search for discounts and coupons.
According to an Accenture study, "Simply having a presence on social media isn't enough--the aspiration should be to become the topic of conversation for all the right reasons. Contrary to the famous public relations maxim that all publicity is good publicity, many firms have found, to their regret, that the negative online buzz they are generating can zap both brand strength and sales. Instead, companies need to engender the type of positive online buzz that can lift brands and sales alike."
Still, sustainability and other social issues remain a Millennial priority
Millennials may be strapped for cash, but they will spend extra to do business with companies that they feel are good stewards of the environment or that support other causes they care about. Millennials shop at thrift stores, not just to save money, but also for environmental reasons, so much so that secondhand stores are growing 20 times faster than other retail operations.
According to a 2015 Nielsen study, "Despite the fact that Millennials are coming of age in one of the most difficult economic climates in the past 100 years, a recent Nielsen global online study found that they continue to be most willing to pay extra for sustainable offerings--almost three-out-of-four respondents in the latest findings, up from approximately half in 2014."
The study continues, "The rise in the percentage of respondents aged 15 - 20, also known as Generation Z, who are willing to pay more for products and services that come from companies who are committed to positive social and environmental impact was also strong--up from 55% in 2014 to 72% in 2015."
The same study found that:
- 72% of Millennials are willing to pay more to do business with a company they trust.
- 70% of Millennial are willing to pay more for brands that promote wellness.
- 69% of Millennials are willing to pay more for organics.
- 58% of Millennials are willing to pay more for environmentally conscious brands.
- 56% of Millennials are willing to pay more to do business with a socially conscious brand.
- 53% of Millennials are willing to pay more for a product that has environmentally friendly packaging.
Millennials value experiences over stuff
This is the experience generation. They don't want to own cars; they want to rideshare. They don't aspire to own vacation homes; they want to rent a new place every time they take a vacation. They don't want to amass a huge DVD collection; they want to stream movies on Netflix and Hulu. They don't want to collect CDs; they want to stream music on Spotify.
Millennials want experiences they can share on social media:
- 82% participate in live events such as concerts, festivals, and sports.
- 78% say they prefer buying experiences over things.
- 55% say they spend more on live events than ever before.
How can brands keep up?
Millennials are more influenced by bloggers and online peer recommendations than celebrities and advertisements, a major shift from previous generations.
- 62% of young people would buy an item that was recommended by a YouTuber.
- 70% of Millennials are more influenced by bloggers than celebrities.
- 69% of Millennials report having FOMO.
- 79% of Millennials believe that attending live events with friends strengthens friendships.
Millennials want brands that listen to and care about them. They also want to make purchases from brands that are socially or environmentally conscious. Learn more about Millennial shoppers from this infographic from Mergein.